France to Increase Tax, Cut Budget During Financial Difficulty

France to Increase Tax, Cut Budget During Financial Difficulty

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With the European financial crisis creating havoc among Euro Zone member's economy, France has been forced to re-tool their budget in light of an unbalanced budget. President Nicolas Sarkozy has been forced to raise about $65 billion Euros over the next 5 years in order to fill the gap.

At the same time, France has had to cut their budget, especially in the welfare benefits that have helped many citizens for years. The moves come as a preemptive strike to protect France's credit rating. Other nations who continued to spend more than they brought in, such as Greece and Italy, are now facing default and may bring the Euro down in value.

The tax increases and spending cuts come right before the election cycle in France and it remains to be seen how the voting public will respond to the government action. Many feel the spending cuts and tax increases are necessary, but it still may affect Parliamentary and Presidential votes.